More Michigan customers on electricity waiting list

LANSING (AP) -- About 4,000 more customers joined a waiting list to buy power from competitors to Michigan's two dominant utilities in 2012, more fodder for those pushing to eliminate a 4-year-old cap on competition in the electricity market.

The number of customers in the queue rose from 6,385 to a record 10,467 in the past year, an increase of nearly two-thirds. They cannot buy electricity from alternative suppliers because Detroit Edison Co. and Consumers Energy are guaranteed at least 90 percent of sales in their regions under a 2008 state energy law. Competitors' share of the market is currently maxed out at 10 percent.

"Those customers have saved millions of dollars compared with higher-priced options with Detroit Edison and Consumers Energy," said Maureen Saxton, spokeswoman for Energy Choice Now, a coalition of competitor energy companies and their business customers.

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They have lobbied, so far unsuccessfully, to lift the cap by arguing more choice would keep rising electric bills in check. Few residential customers can shop around for power because energy companies generally compete only for more lucrative business customers.

A report released Friday by the Michigan Public Service Commission showed Edison's waiting list grew 74 percent last year and Consumers' by 57 percent. To get in the queue, customers signed a contract with an alternative supplier. But they can only leave their traditional provider if a spot opens up or if overall power usage rises enough in a year to allow more customers into the program.

If the cap was eliminated, competitors hypothetically could have had 21 percent of sales in Edison's territory and 24 percent in Consumers' territory, according to the "Status of Electric Competition in Michigan" report.

Regulators who wrote the study stayed neutral on the 2008 law that restricts competition.

But Republicans who control the state House said last week that they planned to review the law, including the cap, because of concerns about electricity rates. Gov. Rick Snyder's administration also is expected to take a look at the law while conducting a yearlong study to help set future energy policies for Michigan.

"The governor believes we should wait until all the facts are in before making any changes and will make his recommendations on where we should go on electric choice and a variety of other energy issues later this year," spokesman Ken Silfven said in an email.

Consumers Energy spokesman Dan Bishop said the law is working as intended and argued that utilities have the certainty needed to make long-term decisions on aging coal-fired plants and other issues.

Though critics say electric bills are up about 30 percent since the measure's passage and are the highest in the Midwest, he countered that Consumers Energy's bills are near the national average. Lifting the competition cap would lead to substantial rate hikes for customers sticking with their traditional utility, Bishop said.

"A handful would benefit," he said. "The vast majority would be penalized with much higher rates."